Many applications of diffractive phase elements involve the calculation of a continuous phase profile, which is subsequently quantized for fabrication. The quantization process maps the continuous range of phase values to a limited number of discrete steps. We present a new scheme with unevenly spaced levels for the design of diffractive elements and apply it to the design of intracavity mode-selecting elements. We show that this modified quantization can produce significantly better results than are possible with a regular or even the bias-phase-optimized quantization scheme that we reported here earlier. In principle this process can be employed to a greater or lesser extent in any quantization process, allowing the fabrication of diffractive elements with much improved performance. © 2001 Optical Society of America.